Project Summary: Cellular programs for development, once believed to be irreversible, are now known to be quite plastic. We also know that the regulatory logic controlling developmental processes is hardwired in the genome. In other words, developmentally controlled expression of confined gene sets determines the identity, cell fate and function of fields of cells (subregions) within an embryo, from which various body parts develop with further subdivisions of these territories. The essential control feature in the process of development is gene regulation in time and space. Access of transcription factors (TFs) to cis-regulatory modules (CRMs) is itself regulated by epigenetic modifications on histone proteins, which modify nucleosome packing of DNA. TFs can also recruit histone- modifying enzymes to CRMs to modify local nucleosome behavior in the vicinity of target genes to control their accessibility and behavior. It is therefore important to understand the interplay between TFs and epigenetic modifications. However, dissecting out these processes, in vivo, is challenging - In most cases we need to deal with a complex tissue environment with numerous cell types, and cells at a given differentiation state have already been subjected to epigenetic modifications by the time we examine the process. Thus, it is difficult to clearly discern whether the specific binding of a TF is solely based on the property of TF alone or the TF binding is restricted due to pre-existing epigenetic modifications. Fortunately, we can address these fundamental questions by going back to the earliest stages of embryonic development when transcription from the embryonic genome has not yet begun and the number of different cell types is small. Using Xenopus tropicalis (a true diploid), we found that the Foxh1 transcription factor, a well-known mediator of Nodal/TGF? in early mesendoderm development, plays key roles in coordinating transcription initiated at the zygotic gene activation. When we examined Foxh1's dynamic action across early development, we discovered that Foxh1 recognizes the CRMs of target genes during early cleavage stages, before any signs of epigenetic histone marking, and marks these regions well in advance of zygotic gene transcription. We hypothesize that Foxh1 is the maternal master-regulator that is upstream of key circuitry regulating the mesendodermal hierarchy and regulates chromatin states so that these bookmarked genes are selectively activated at appropriate developmental stages. Importantly, we also discovered that Foxh1 recruits the co-repressor Tle (Groucho) to cis-regulatory modules in the early blastula, and subsequently coordinates the recruitment of a well known endodermal pioneer factor Foxa. Based on these observations, we propose the following specific aims. Aim 1: How does Foxh1 interact dynamically with Tle and Foxa to regulate gene expression? Aim 2: What are the structural features of CRMs marked by Foxh1 that enable them to regulate gene transcription? Aim 3. How is Foxh1 activity regulated in different germ layers? Does Foxh1 influence epigenetic states of genes? We will study the developmental role of Foxh1, in vivo, using X. tropicalis. The early embryo has a low complexity in terms of numbers of different cell types. These advantages combined with the relatively close evolutionary distance between Xenopus and mammals places the X. tropicalis system as the ideal system to examine the function of master TF Foxh1. In vitro differentiation of human ES cells into the DE lineage has been well established and one can obtain highly pure populations of DE cells in monolayer culturing conditions. This, coupled with a wealth of genomic information regarding hES cells, makes the use of these cells an ideal proxy for in vivo human endodermal differentiation to be adopted for this project. This project is significant because we will uncover a biologically important mechanism that have remained enigmatic and will attempt to extend observations to human development.